Lord Lee of Trafford
Main Page: Lord Lee of Trafford (Liberal Democrat - Life peer)
Lord Lee of Trafford
To ask Her Majesty’s Government what progress they are making in considering whether shares quoted on the Alternative Investment Market should be eligible for ISAs.
Lord Lee of Trafford
I declare an interest as an owner of shares in a number of AIM quoted companies.
The Commercial Secretary to the Treasury (Lord Sassoon)
My Lords, the Government are considering this question and welcome representations from interested parties. They will set out their approach in due course.
Lord Lee of Trafford
I am grateful for that Answer. I had hoped that the noble Lord might achieve instant popularity by giving a rather more positive Answer, but we obviously welcome him with his considerable City experience. At 30 April, 1,250 shares were quoted on the Alternative Investment Market with a total capitalisation of £64 billion. The Stock Exchange believes that capital raising would be much easier if AIM shares were made eligible for ISAs. In broad terms, a decision by the Government would be tax-neutral. Given that shares quoted on the Channel Islands Stock Exchange are eligible for ISAs, does the Minister agree that it is time that the Government changed their decision and gave investors the choice?
Lord Sassoon
I agree with the noble Lord that there are 1,250 companies on AIM, but of those about 750—60 per cent—have a market capitalisation of less than £25 million. I also remind your Lordships that the purpose of the ISA was to hold mainstream products, so there is a tension between the very many smaller companies on AIM and the fundamental purpose of an ISA. The Government have a number of schemes for assisting the capital raising of smaller and medium-sized companies. I have not seen any evidence that it would be materially easier for those companies, albeit that there clearly would be some effect at the margin, if AIM shares were included in ISAs.